State of the Project Update from Kingdom Studios Board (June 13, 2022)
Link to the recording: https://www.youtube.com/watch?v=lrmY3dXZ8r8
Speakers:
https://defikingdoms.com/team.html
State of the Kingdom
Frisky — Basically we want to talk about where we are at, where things are, where internal workings are going with the team. What we are trying to prioritize and do so that we can best react to the markets. Up here with me is the board of Kingdom Studios. Beetle Dude, Mr. Faun, Rooster and Dreamer.
I think that Dreamer has some stuff he wanted to lead out with. He is the president of the Board so I’ll turn it over to you.
Dreamer — I wanted to recap a bit the last year and where we are looking at focusing now. There have been Q’s in recent months and in some AMA’s about vision of game, long term trajectory, and the project has been building real trim and with that we grow real time and talk to the community real time. We put in processes and policies and roll with the punches of the market as well. Today we’ll be talking a bit about vision and next steps for DFK and how it relates to the market as well.
Last year when there were very few people in the beginning it started as a decentralized collective run by Fox and everyone was paid in Jewel. How much you paid and the bonus structure varied from team to team and market to market. As that progressed to end of last year and the entire market saw the rise of the bull market, we entered into what seemed like a shift and when we saw the markets pull back we started to make decisions on how to shift from that decentralized collective to more of a business that would be set up to run in bear markets and grow in bull markets and evolve with good partners in the future.
Part of that has been creating an entity. We now have an entity, a board, legal representation, offshore entities and its setting us up like a real world business. With the analysis of looking at a jewel-based payment system and you look even weeks past launch, price went to $1.00 pretty quickly and a month or so later we were in the $4–$5 range. In the $18–22 range there was ongoing analysis on what we’d need to do if we went back to the $2.00 range. As we saw markets make some big moves and some very Lehman brother type events and being impacted by overall markets and how that is impacted by feds, wars, small cap stocks, bond market, blue chips, etc. We’ve given updates on spending and updates on working through KS to pay people and a more legitimate way to be contracted and with that came adjustments to compensation, the timing, the type, all of which people have the right to make a decision if that works for them, which is different than the decentralized collective like how it was run before. There may be people that choose to look at that opportunity and do something else and to those we wish them well. There have been people who have chosen to keep working with what we’ve been calling the project, but we should refer to it as Kingdom Studios. Looking at Solvency, server costs, minimum costs, and like many other projects in this space have been looking to raise capital. raising capital will be focused on identifying and working with some very good and strategic investors, there will be a few types of investors, some may be purely capital based, some maybe e decentralized or crypto based and some may be large gaming studios outside of the crypto space and we are open to all of it, but what we are working on now to gear up to that pitch, we have set up an entity, we have a board, we have adjusted expenses, we are legitimizing the shift from decentralized collective to overall business and now we need a pitch book. That pitch book needs to show business model, primary and secondary segments and overall vision. What will be coming next as we work on this is what does that vision look like and what will we be pitching to our future investors. We are very excited to be working on that. Directly related to feedback, we have a roadmap and have been working on that at an incredible pace, but we want to be clear about the business model itself and all the pieces to that and how it will relate to future partners. I’ll pause there for anyone else on the call to chime in on anything I’ve covered.
Frisky — It’s been such a crazy year. It was amazing to launch with this team with a scrappy startup mentality and paying ourselves with jewel that wasn’t worth anything. As that Jewel was worth more we had to adjust pay and worry about not paying too much and we were constantly trying to adjust. A month and a half ago or so we started pivoting to do what we need to if we hit $1.00 or if we hit $2.00 we’d need to adjust, $1.00 even more adjustments. That’s part of why we created Kingdom Studios so that we could set up accounts and pay out Fiat to people. It’s unfortunate that at that time the market crashed at that time, but its also good because if we hadn’t we’d be in a much worse spot. We are almost going back to startup mentality and we have Jewels and Locked Jewels and people who are still very fervent about the project, myself included, who are willing to still work through that and earn locked jewel, but there are others who cannot. Everyone has their own situation with their personal lives and their families, some have left other jobs for this. Everyone has their own situation and we do respect that if that is the case for people. We are trying to do what is best for the project and all of the people in it. As Dreamer said, also looking for other types of revenue sources, we have Merchandise, we have brand, IP, great community, there are lots of opportunities there. A lot of cool features coming out, we aren’t just starting from scratch. A big part of that is trying to secure funding so we can keep as many people as we can.
Rooster — One of the things we’ve done is making sure we’ve secured enough funds for the servers. We can cover expenses from a fiat standpoint for a year (not including payroll), we can cover some payroll, but will have a startup mentality where a lot of compensation would be in locked Jewel and so that it wouldn’t vest all at once. From a funding standpoint we’ve had some really good talks, nothing has been secured but I see that as hopeful and that could put us in a great position long term as we create some really amazing features as well as features for an alternative direction as we will potentially be showing a pitch deck in the future of the direction that we’d like to go, which is super exciting and we are excited to express and show to the community in the future.
Frisky — huge shout out to Dreamer who’s been heading out to events and private dinners and meeting with people every day, fighting the good fight on that front, and also to Beetle and Faun and all of those who are building. It’s heartening to see that as the going gets tough the tough get going and there’s lots of tough people on our team.
Dreamer — just want to extend those kudos to everyone else as well. As we gear up towards potential strategic high quality partners, those in the community that were attending events live, the knights, the core team members, those sending info over DMs, we are all contributors to DFK and although the people in discord and elsewhere might get heated or passionate because we all love this project. We have an incredible platform, and really good assets on the platform, we are positioned to do really big things in this space and that will only be enhanced further by strategic partners, whether gamifying other protocols or partnering with triple AAA games or even partnering on development of the game itself. It’s always a positive conversation, ears perk up. The level of innovation is so attractive and in this market people are saying we are in a builders market, people are saying we weren’t building but we have been. We think that having help from the community and all the great people ewe are working with now is the path to get there.
Frisky — What about Jewels in the funds, this is why we adjusted pay rates back when we did because we saw the trajectory. From the start of the project we were spending under budget. WE minted 5M Jewel to the funds between development and marketing. Each week we brought in more Jewel than we spent because of how the protocol was set up. This allowed us to rapidly grow the team and have really good artists. We had knights that were paid, which isn’t super common in this space, which was awesome. We have amazing knights by the way. So what about the Jewel fund? We saw back in March or April for the first time we went under the initial amount that we had minted and that was a bit concerning because that’s the first warning light in showing we are spending more than we are earning and that’s what precipitated a lot of this. The plan wasn’t to figure out how we can get to zero and survive, because if those go to zero, we are already dead, the plan is to figure out how we can spend under what we are bringing in, so that when it does come back we have the war chest ready. So that’s the adjustments we’ve been working on. Of course the revenue sources are hero summoning, questing, gardens, etc., and we are adding more and more to that like Pets and Duels that will increase the bottom line, but with the price falling and falling that gets tighter and tighter. We talked about bad scenarios of $1.00 and then worse scenarios of $0.50 and now we are at $0.20. Several of us have been working for free and that’s fine. I’m able to do that because I was here since the start, and we have a lot of passionate people with ideas on how to do this or that with the game. How to have new revenue ideas and a lot of those are amazing, I ask you to be patient with me as I work on those.
Faun — I think there’s a bit of confusion between Kingdom Studios and how it relates to the game itself, maybe we can clarify?
Frisky — We have KS that we set up to do a lot of things for us, to enable us to hire lawyers, do KYC for some partners, and to have more of a traditional entity set up here to allow us to work in a more efficient way and have a board and the ability to do series funding and the ability to receive grants. That’s how that came about. DFK has an offshore entity created, that is run more like a collective, it has ownership of the dev funds and wallets. The regulatory stuff around that is tricky, and that’s why we had to set it up that way because there’s a lot of uncertainty in different Jurisdictions, that’s a different board that handles the multisig, none of the people here to sort of have a separation of interests. It’s an SLA type partnership with them where KS contracts with and provides services to DFK. So KS is essentially a development agency that provides those services, among other things, like merchandise, marketing and community management.
Dreamer — There was something in chat related to this. When talking about potential investors and strategic investors, many can think of that like new participants in DFK, and new people coming in and buying Jewels and Heroes, while that is fair to say, our comments today are around ownership of Kingdom Studios and the arrangement that Fox just went over. So we are looking at raising capital, an ownership raise in Kingdom Studios, and that could be a VC firm, an existing DeFi protocol, a AAA gaming studio, or any other type of investor to provide fiat based capital for overall expenses. Just wanted to make sure that was clear as it relates to seeking an “investment” in Kingdom Studios from Strategic Investors
Frisky — If you look at Avalanche they have Ava Labs, Axie Infinity has a studio that employs the people actually building it. There is funding to build that ecosystem. That is what we are doing, trying to get that funding to provide services to the project. You start a project like this and then see if there are other people interested in seeing this built and turns out there was and you grow the project and eventually it grows into a thing where its a real business.
Frisky — Regarding Aila — she was a person that was here for a very long time. She started the server here. She was on the core team. We had tasked her with being in charge of the community and growing that. She did a great job of it. Later we added Bolon and he was able to really carry that Torch and run with it. A lot of the people that we started out with were those that were willing to stand up and take a risk on this thing that had a lot of unknowns and a lot of them were compensated really well for that risk because it ended up really paying off. As we grew larger and larger, that growth outpaced some of our skill sets and part of that included adding more and more to our team to help carry that torch, and part of that growth is that it outgrew them, and that’s fine. As that growth happened it got tot he point where some were working so much they decided to scale back and go more part time or just be advisors. As we scaled our pay back, there was more of that as we moved from startup mentality to larger business with strict budgets and then back to startup mentality.
Faun — A few weeks ago when we were scaling back, people were being given offer opportunities. Aila was given an offer that was less than what she was previously making, but not a single person was not offered less than what they previously made. Aila asked for more, but given the continued price movement we weren’t able to fulfil on her request. Our HR team reported they had a conversation with her today that in our perspective had gone well and we even mentioned that if things turned around we’d try to accommodate her salary request and we left that conversation thinking that things were calm. We’re always sad to see people leave and sad to see people post negative things about the company. It’s a hard time and there’s a lot of hurt right now and we are trying to band together as a team.
Frisky — I also think it's important to address that everyone is in their own situation. A lot of people, myself included, we had a lot in Jewels and still do. I’m still very vested from the fact of playing the game and having hero's and assets and I want to see this become a success and I want to see this appreciate in value and the way we do that is to build and add value. How do we build and how do we add value to this. There are others we offered to and they said great, but I can earn more somewhere else, and so it didn’t make sense for them to stay, and that’s fine, everyone has their own situation. That’s where we are at.
Questions from community in Discord:
Frisky in response to community — one of our biggest assets is our IP at this point. We’ve been continuing to work on the community developer docs.
Faun — here are the docs: https://defikingdoms.gitbook.io/developers/
There’s quite a bit to still put out for this effort to make this more of a lasting relationship, but I also think that we can use this as a really good foundation.
Q re changes to emission to reduce sell pressure:
Frisky — we can have a vote, those types of things are possible.
Can we get the SLA between KS and DFK once settled?
Frisky — will need to talk with our lawyers, I’m not sure what the laws and confidentiality regarding that are, but basically the gist is that KS provides services to build out and would be getting x amount of Jewels from the funds to cover those expenses on an ongoing basis for a contracted amount of time (wanted to have 1 year with auto renewals unless further changes made).
Dreamer — I don’t think there’s going to be any differences between what was referred to as core team and contributors before. Now we just have the ability for people to be paid in Fiat, KS could be paid in Jewel. Right before we started making pay adjustments, we said we were “profitable” each week meaning the amount of jewel brought into the funds was more than was used (to pay people, attract talent, etc.). Now the dev company, KS could use it as collateral for loans, use it to get contracts, use it to enter into agreements. It’s what we needed to be able to work with other entities that probably had a year to set up an on shore entity. We were limited without the contracts, and we’ve been working through it real time as we build out content. We’ve been doing our best to work for the project and the overall features.
What state are we at in raising?
Dreamer — efforts have been putting us in a position so that we could. Without all the groundwork, any discussions we’ve had wouldn’t have worked. Any pitch wouldn’t have been able to show the value to an investor and what it means to monetize cross chain gaming and gaming protocols. Now it's making it as clear as possible to various partners to make sure we are aligned so that we can pitch and find synergies to make the dream a reality. So not far on funding itself, have been working on setting up meetings, but have not had any meetings yet. That’s part of what we did in Dcentral, we gave out merch, had a keynote, had a panel, set up a booth.
Frisky — As far as timeline goes, this isn’t something that goes fast. We have to have a really good pitch deck, which Dreamer has been working on, along with other people. Those can take a while to figure out the details so we have other plans in the short term to ensure that the things we release have a really good impact on the utility for our tokens. We also have an initiative for merchandise and how that can play into the game in a way that we haven’t ever seen before in this industry. There are other things that we are doing.
What about longer term things like PVE and PVP?
Frisky — those are really the end goal for a game like this. That’s what I’m most excited about, and I’m going to be working on those because that’s what I really want to say. That said it is a lot of work and it takes a lot of time and we have lost some of the members working on that. it is still happening one way or another, that is one thing I’ll be working on because I love it. There’s other things too, Hubert has ideas, Boo has ideas, Kant has ideas on various things like lands and guilds. All of those things take time. When you look at traditional games, it takes years and years.
Rooster — as we roll out merch, it would be a great way to support us. I’ve seen some really great things being put together for this. Some of you have Merch already that we passed out, but that’s something to look forward to in the near future and we’ll obviously be announcing that shortly and that’s something that we are working towards at this point.
Builders program and status?
Frisky — We’ll be looking at this soon to confirm we can incentivize as much building as we can. We have still yet to receive some of the grants that we have been approved for from Harmony for example, about 1M that we need to set up a multisig for. Ava labs as well, there’s a grant there that we are trying to bring home through the Kingdom Studios entity. A lot of those are part of why we had to create the entity. A lot of these grants needs to have KYC, need to have trails, etc., and part of that was preparing for the grants.
Can we see a platform like Discourse on the community website with feedback forum?
Frisky — I think having a feature to be able to upvote and what not would be helpful to better see what the community wants to do. I think that's entirely within the purview of a platform like this. I think we could have a platform that is a staging ground and maybe if it gets a certain amount of votes it will get pushed on for a vote.
Q from Mettez:
On locked Jewel
2 months ago: the team said that informing people about the unlock numbers would be key. But the numbers are not great, as the total Jewel added daily to circulating supply will at least hit a 5x at unlock
3 weeks ago: you said addressing this unlock was a priority and that you were meeting in a “tokenomics committee” a few hours later that day to talk about it.
Last week: you said that this wasn’t discussed at the tokenomics committee, but you’d prioritize it because the conversation still hadn’t happened,
We are now merely 3 months away from the unlock with no tangible solutions.
Let me be extremely clear: This topic has been raised by this community (not only by myself) months ago, and has been a hot topic of discussion and worry. Up to this point, no potential solution or utility has been discussed, except for vague words such as “using locked Jewel in game”, while not actually making any discernable progress on these issues for weeks, if not months.
Let me be even more clear and practical, and if you forget everything else I just said, remember this:
EVERY WEEK DFK WAITS TO ADDRESS THE UNLOCK PRESSURE, MORE POTENTIAL LOCKED JEWEL UTILITY IS DESTROYED
Potential avenues that could provide utility to locked jewel in a relatively short timeframe:
* Allow for the breeding of pets by burning locked Jewel
* Allow for restoring of 1 summon by burning exorbitant locked Jewel prices (with scaling costs for rarity/class etc.)
* Allow for raffle tickets purchases by burning locked Jewel
* Allow for another gen 0 gene reroll by burning insane locked Jewel amounts
* Release a type of quest (maybe mining related) that allows destruction of large portions of locked jewel for stronger XP gains
I just hope that me repeatedly raising this issue prompts the DFK team to address the issue seriously, to look at the numbers more clearly, and to implement easy and incentivized locked Jewel burning mechanics.
Dreamer —I think the emphasis here is on timing. I don’t know when we will have an actual delivery of it and I agree with the sentiment of the question and in the committees its the same. I would say the suggestions are not far off from what could be possible and I think the inclusion of larger decision and even voting on these or utility of locked Jewel in game could work. There are other ideas as well, and I’ll be careful in what I say but utility and even burning are all ways that we can add utility and gamify the various features. It’s a good post and a good comment and I don't’ think its far off from the solution that we are trying to work towards.
Frisky — Thank you Mettez for the thoughts. I agree its important. This has been on my mind a lot. How can we relieve some of the impending sell pressure. A lot of protocols are set up in a similar way and they have tokens that vest and have cliffs. Ours aren’t a cliff, but it's almost like a self fulfilling prophecy, and people say x will happen at this even so I’m going to sell and so everyone starts selling. it’s really a question of optics, the optics being that the amount of Jewel being put out there is not that much more than are putting out there in the earliest stages of the project. But that’s not important as the actual optics, and we need to add utility to be able to use those locked jewels and give appetite and utility there. There's also things we can do with governance votes and allow people to vote on how we do things with locked jewel. We could have people vote for those proposals with your locked Jewel so that all those with locked jewel have a voice on what happens to those locked Jewels. I’ve spoken to a lot of whales that have locked Jewel and they are very eager to see change that could impact their own locked jewel and might be viewed even in a negative, way, yet these whales are smart and know that if they can do that and help support the value of Jewel long term it is better for everyone. This is high on our list of things to address. It does take a while and there’s a lot going on as well.
Community consensus, we love AMA but need a forum with feedback like UserVoice
Frisky — We had UserVoice for a bit, it ended up being $1,000 a month, but we might try and find something cheaper or we might bite the bullet and do it.
Speaking of server costs, we have secured enough hard USD to pay for server costs for the next year. We always want to make sure we have enough to keep the servers live, even if the markets get really bad.
What has happened with Payroll?
Dreamer — looking for unique solutions with long term upside for those able to work on the project and helping us through this rough time globally but also the next stages. Like many projects do, vesting tokens. In that scenario, you are working for equity so to speak in a startup, so if you receive Jewel and it unlocked in the future and we are working in a later stage in the bear market and price ends up better later down the road that’s a long term incentive. Server costs we have to pay fiat, but for those dedicated to the project we can do this.
What's the current runway assuming no infusion of capital by investors?
Frisky — the bear markets, who knows, they could last months or years sometime, so being able to build during that time and going to the startup mentality and being able to pay people with locked jewels and having sweat equity, a lot of people are excited about that prospect, but there are hard costs like Discord, servers and services that we need fiat for, and that’s why we moved to secure funding for those ASAP, and we’ve looked to new revenue streams like merchandise, gamification of other services looking to get into this and having them be part of our ecosystem and amazing player base. Lots of things that we are exploring.
Considering pausing leaderboards?
Frisky — it doesn’t have to be jewel given out, could be all sorts of valuable in game items like Eggs and heroes themselves. Runes. That is stuff that we can also look at there, it doesn’t have to be Jewels.
Frisky — you see a lot of projects lose steam and die in bear markets. We want to do our best to set ourselves up so that we can emerge at the end of this and still be strong because when it does come back and we all know that this is a cycle, and you look at stuff in the past you have a very real possibility for it to come back even stronger. Do with that what you will, I’m not saying this is financial advice, but I’ve been in the space for a while and I’m not worried. That is our time for this, sorry if you asked things and I didn’t get to this. I’ll try to go back into the chat and answer some questions as well. I know a lot of people had questions about what this market means for the future of the project so that was the intent of this call to let you know we are still here, we are still working and we are still building. We are still excited about the project. I know a lot of you are wanting to help out, feel free to reach out. A community that is able to pull together can survive this. Thanks everyone for coming.
Dreamer — I agree, I think we’ve covered so many different topics in the last hour, I hope that we can continue to communicate as a community, project an team. We like difficult questions posed in a constructive way. We look forward to those that will join us in the future and this might be a long road, I can’t tell the future, but I can say that I’ve heard so many people live talk about how excited they are about what we’ve made and what the plan is for the game and the business lines. We have the interest and the dreams to keep pushing forward. We need everyone’s support not only to ask good questions but to have good solutions and have each other's backs. I saw a lot of people in the last 48 hours in the market be really emotionally affected. People are struggling. I hope that we all try to be kind to each other. As we lift each other, we will be better able to get good results and to weather the storm. I’m grateful for everyone on this stage and grateful for all of these questions, even the ones that are really direct. Grateful to all the contributors form the start until now.
Rooster — We’re excited to make things work. I know there are some amazing people on this team as I’ve seen people come together, especially this last week as I was able to meet some of them. It’s encouraging to see everyone’s interest in the project and their love of the project and their love of the team. I was able to meet Dreamer live and what a great guy. I know we are going to come together and really come together to produce a good product as long as we stay together as a team.
Frisky — a lot of people are going through a lot of things with this market. Moderators, members of our team, have been doing superhuman things for so long. But we aren’t super humans. We are actual humans. We appreciate those that reach out with words of encouragement and kindness. We are trying to make something awesome. I’ve worked harder on this than anything else in my life and I have a lot of hope for the future. Remember to be kind and to treat others in the community with respect and lets build together.
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